I hear people saying the Phoenix Market is frothy again…prices are too high and investors are the only people buying properties.
This couldn’t be further from the truth. Our market has healed, although there may be a scar. We talk about the Market being back to health when Investors retreat and “normal” home buyers…”end-user” buyers, as we say, dominate the market… see graph below.
These “end-user” buyers qualify for loans…Investors typically pay cash. Well, we’re here and end-user buyers ARE getting loans. Typically, in a “normal” market 15%-20% of transactions are bought/sold to Investors. For the month of March that was only 12%. Really? 12%???
The market is reaching traditional levels of demand and that demand is coming from “end-user” buyers…that’s healthy!
The Mortgage Bankers’ Association publishes the Mortgage Credit Availability Index (MCAI). According to their site the index is “a summary measure which indicates the availability of mortgage credit at a point in time”. As we can see from the graph below, mortgage availability has been increasing dramatically over the last six months.